Benefits of Managed Futures

The advantages of investing in managed futures within a well-balanced portfolio include reduced volatility, the ability to profit regardless of market direction, and global portfolio opportunities.

Managed futures as an asset class is increasingly being recognized as an important investment alternative that can potentially enhance the returns and lower the overall volatility of a portfolio.

Although futures investments involve substantial risk and are not suitable for everyone, the introduction of managed futures to an investment portfolio can both reduce risk and enhance performance.

A Cautionary Note

One of the popular strategies amongst CTAs is the sale of naked options. This strategy tends to work in periods of relatively low volatility, however when volatility spikes, the strategy frequently results in disaster. We therefore suggest that investors intent on allocating funds to CTAs employing such strategies do so with a small portion of their portfolio or as part of an overall blended portfolio of varied trading styles to diversify holdings in hopes of offsetting such risks. Your Managed Futures specialist can assist you in creating such blended portfolios.

Adding Managed Futures to a portfolio does not guarantee that it will lower the risk of an investors’ portfolio or increase the profitability. The commodity trading advisor that is selected by the investor will determine the effect on a portfolio. The CTA Index is not necessarily representative of all CTAs in the industry. Only CTAs that choose to disclose their performance to this index are included in the calculation of the CASAM CISDM CTA Index used on this website. Customers cannot invest in a managed futures index and the commodity trading advisor selected by the customer may have performance that is substantially different than that of the index.

Futures, foreign currency and options trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. View Full Risk Disclosure.